"Why is it necessary to transfer money out of a public institution like the community college for that money to be used to benefit the community college and the community it is supposed to serve?" asked Walt Seymour, an accounting instructor at San Diego Mesa College.
But Peed said that the foundation's staff is far more efficient than district employees at scheduling, counseling, registering and advising the 16,000 Navy personnel in the classes. The foundation, he said, is actually saving the district money by running the classes.
"I don't see anything wrong with it," said trustee Daniel Grady. "The foundation is actually doing a service, and this is what the foundation is getting paid for."
Meanwhile, a separate union is contesting the district's decision to switch control of all adult education foreign language classes to the foundation in 1984.
The switch allows the foundation to pay the faculty who teach those courses a lower base wage than they received as district employees. They are paid under an incentive plan allowing them to earn more by attracting larger numbers of students to their classes.
For some of the more senior faculty, the switch amounted to more than a 50% pay cut, said James Gattey, who is representing the San Diego Adult Educators union before the state Public Employees Relations Board.
The district "set up obligations and negotiated a contract, and pretty much dumped them out the window," Gattey said.
Dyer said the district switched the courses over to the foundation when budget cuts made them too expensive.
Grand Jury Review
Horn and others also contend that they cannot monitor the foundation's use of funds because it does not publish minutes, hold open meetings or allow the public to review its contracts. As a corporation, the foundation is exempt from such requirements, said William Abbey, deputy attorney general in the charitable trusts section.
Though the foundation files public, annual reports detailing income and expenditures with Abbey's office, Horn and others said they have had difficulty obtaining information from the foundation office. Last year, Horn brought his concerns to the county grand jury, which conducted a preliminary review but did not find reason to do a full investigation.
"I have no way of knowing how they're spending the money because I have no access to their records," Horn said. "I've asked to be informed of their meeting times and places and they've said 'it wouldn't do you any good because we wouldn't let you in to observe.' "
"It's a private operation," Peed countered. "It's a nonprofit corporation. Fred Horn has no right to go over and scrutinize what National University does. (They) would tell him to go jump in the lake."